Warburg Pincus – Mariner Finance

December 11, 2017

From report “Private equity piles into payday lending and other subprime consumer lending”

(Written jointly by Private Equity Stakeholder Project and Americans for Financial Reform)

New York-based private equity firm Warburg Pincus acquired installment lender Mariner Finance in May 2013.[i]Mariner Finance has more than 450 branches in 22 states.[ii] Former Treasury Secretary Tim Geithner serves as President of Warburg Pincus.[iii]

Warburg Pincus Managing Directors Michael Martin[iv] and Arjun Thimmaya[v] and Principal Eric Friedman[vi] serve as directors at Mariner Finance.

Similar to OneMain and Lendmark, Mariner Finance makes larger loans and charges lower rates than payday lenders. Mariner Finance makes personal loans of $1,000 to $25,000, including online loans of up to $7,000.[vii]

Also like the two other installment lenders, Mariner Finance charges fees that can inflate the cost of its loans. In a recent disclosure in Delaware, for example, the lender reported than in addition to charging an interest rate of up to 36%, Mariner also charges a “Recording/ Satisfaction Fee” of up to $151. Depending on the circumstances, borrowers may also face variety of other fees including an “Internet Payment Fee”, a “Check by Phone Fee,” a “Loan by Mail Commitment Fee,” and a “Legal Fee”. Mariner also charges a significant ($150, in Mariner’s case, fee for refinancing loans – which could incentivize the lender to encourage borrowers to refinance.[viii]

In early 2017, Mariner joined OneMain and Lendmark in bundling the loans it makes into securities that it the sells to other investors. In February 2017, Mariner issued $275 million of Mariner Finance Issuance Trust 2017-A securities.[ix]

In addition to unsecured consumer loans, Mariner also offers car loans and home loans.[x]

[i]“Consumer Finance Industry Update,” Hyde Park Capital, May 2014.

[ii], accessed Aug 3, 2017.

[iii], accessed Sept 12, 2017.

[iv], accessed Sept 16, 2017.

[v], accessed Sept 16, 2017.

[vi], accessed Sept 16, 2017.

[vii], accessed Sept 12, 2017.

[viii]Mariner Finance Delaware Fee Disclosure, June 2017.

[ix], accessed Sept 22,2017.

[x], accessed Sept 12, 2017.

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